IN the lead-up to Christmas the Australian translational medicine community was given an early present as the federal government announced the formation of the $250 million Biomedical Translation Fund.
The fund, part of an overall package designed to promote innovation and entrepreneurialism, represents a welcome step towards making Australia a more hospitable place for bio-entrepreneurs. However, while the scheme is a good start, challenges remain.
For those unfamiliar with the term, biomedical translation refers to the process of converting ideas into tangible products. In essence this involves developing a base, scientific or clinical discovery, into a treatment, device, test or drug available in the clinic.
Fundamental to biomedical translation is world-class research. In this respect, Australian scientists have long produced a quantity and quality of research far above that of comparably sized nations.
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Names like Howard Florey and Graeme Clark rightly hold lofty positions in the pantheon of Australian medical greats. However, Australian institutions and innovators themselves are less adept at translating and commercialising these discoveries.
This problem is not limited to biomedical translation. In fact, according to the Global Innovation Index, a measure and ranking of a country’s innovation capabilities and results, Australia lags behind countries such as New Zealand, Ireland and Sweden, in 17th place. Generally, Australia performs well in innovation inputs such as educational and infrastructure metrics but is lacking when it comes to innovation output.
It can be argued that innovative Australian doctors face even greater challenges than the average Australian entrepreneur.
Australia lags behind similar countries in terms of fostering creativity and innovation in the medical landscape. Whereas in countries such as the UK and US programs such as combined MD/MBA courses or research-centred foundation years are proliferating, Australian medical education remains largely rigid in its clinical focus. Portfolio careers are known to be of significant interest to junior doctors but integrate poorly with the Australian training framework, stifling opportunities for creative minds.
Further, Australian innovators often face a dearth of early-stage financing and support. This was identified as a primary driver behind the creation of the fund. Early-stage start-ups often rely on funding from the “three Fs” — family, friends and fools.
Support and guidance in the form of incubators, hot desks, technology transfer offices and entrepreneur networks assist greatly but are largely in their infancy in Australia, particularly when compared to hotspots such as San Francisco and Boston. Once these avenues are exhausted, angel investors, then venture capitalists (VCs), typically bridge funding gaps. Although life science-focused VC firms do exist in Australia, funds are fairly limited compared to US and European powerhouses.
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The problem of limited funding is exacerbated by the nature of health innovation, which is a notoriously tricky field to invest in.
Take, for example, an Australian start-up with a promising candidate for a new small-molecule drug. A 2014 study conducted at Tufts University estimated that the cost of developing a prescription drug was US$2.6 billion and takes the better part of 15 years. What is more interesting is that only $1.4 billion of this represents development costs. A further $1.2 billion is calculated to be forgone returns — in other words, the cost of not investing in another field or technology. In the age of blockbuster apps why chase after a blockbuster drug?
Clearly government support is needed to help get biomedical start-ups off the ground and in this respect the fund is very welcome. Although the government initiative is a small step relative to the true cost of biomedical innovation, one can only hope that it produces enough momentum to generate genuine enthusiasm for innovation among Australian doctors.
It is evident that cultural, structural and financial hurdles remain significant but they are not insurmountable. The long-term benefits of a thriving biomedical industry are obvious with the creation of sustainable industry. But most importantly to doctors, an Australian biomedical industry represents an opportunity to improve the care of our patients.
Surely that is worth investing in.
Dr Tim Lindsay is an Australian junior doctor and PhD student in the department of surgery, University of Cambridge, UK, supported by the Cambridge Commonwealth Trust. Dr Harley Myers is a plastic surgery registrar at the Northern Hospital and treasurer of the Victorian branch of the AMA Doctors in Training Subdivision